It would have been closer to hundreds of thousands. And it would have cost tens of thousands of American lives as well. To defeat and pacify North Korea you'd have to occupy the nation with an enormous military force, upwards of a million total soldiers or more. That's assuming China tolerated it, which is very unlikely. The terrain in North Korea is almost ideal for guerilla fighters, and it would present a brutal challenge to any occupying forces.
China was significantly responsible for making North Korea what it is today. They like having North Korea as a stick to poke the US, South Korea and Japan with. North Korea is a wildcard that makes the region very complicated and dangerous for the anti-China alliance. They have very little interest in seeing it dismantled. If China had wanted North Korea, they would have taken it a long time ago; it's a rather trivial bit of land next to China; but in its present use, North Korea can be exceptionally useful to China, it's a net positive asset in its present form. They're already a quasi vassal of China, they're hyper dependent on China for almost everything. China gets a lot of upside from the arrangement, with few downsides.
> The US and SK could have handed over NK to China as an industrial colony for all we care
Absolutely not. That's among the worst things the US and South Korea could have done. Assisting China in territorial expansion, de facto helping China to conquer another part of Asia, would be grotesque.
There's no moral argument for claiming other nations have a right to dictate to the North Korean people that they are not to have their own nation. The two Koreas have been separate for a long time now, it's not like that separation just happened a few decades ago. If they want to unite with South Korea, then they should be allowed to. If they don't want to, that should be respected as well. Forcibly handing them off to China and dissolving their nation without their input would be an extreme violation of human rights.
North Korea as a nation belongs, properly, to the people of North Korea. Not to China. Not to the US. Not to South Korea.